Corn prices in Ukraine are falling, but they may be supported by increased demand from China

Purchase prices for corn in Ukraine continue to fall amid a drop in global prices to a three-year low and an increase in freight costs due to shelling of Danube ports.

Prices for corn for delivery to the Danube ports fell to $138-150/t, to the port of Constanta – to $190-195/t, to the Ukraine-Hungary border – to $130-135/t. Prices with delivery to the western borders of Ukraine decreased the most as a result of the extension of the ban on exports to neighboring EU countries.

December corn futures fell to their lowest level since December 2021 on Friday at the Chicago SWOT, but recovered on Monday to rise 2.5% to $192.4/t.

According to the US MSG quarterly report released on Friday, corn stocks in the US as of September 1 amounted to 34.57 million tons (34.98 million tons last year), although traders estimated them at 36.3 million tons.

Thanks to the dry weather on October 1 in the USA, corn was harvested on 23% of the area (21% on average for 5 years).

The active export of corn from Brazil, which will reach a record 8.7 million tons in September, will exceed the figure of September 2022 by 40%. Anec experts predict that the country will export 9.6 million tons of corn in September. For comparison, the USA exported 2.6 million tons of corn in September, and Ukraine - 0.6 million tons (2.1 million tons in September 2022).

Activation of the call of ships for loading to the Black Sea ports of Ukraine through the humanitarian corridor allows us to hope for an increase in Ukrainian exports.

Over the past two weeks, Chinese importers purchased 0.5-1 million tons of corn in Ukraine for delivery in October-December from Black Sea ports. After significant purchases of corn from Brazil, demand from China may decrease slightly, but traders hope that Chinese buyers will accept some risks in order to get cheaper Ukrainian corn. We will remind, in the current season, China will harvest 285 million tons of corn, which will exceed last year's 277 million tons by 2.9%.

The market is now watching the weather in Argentina and Brazil, where a delay in the rainy season is slowing corn planting.